Indeed, few materials have inspired such devotion and obsession. With gold as the focal point, wars have been waged, oceans have been navigated, and the depths of the earth have been explored.
In Poland, the tale of a king who imprisoned a young alchemist for years, convinced he could manufacture gold, is but one example of the frenzied passion that surrounds the substance.
That experiment was a failure; however, the impulse behind it is telling. For millennia, humanity has chased gold, worn it, worshipped it, and built economies around its allure.
With that said, where does this fixation originate? Professor Nitika Garg, a researcher in consumer behaviour at UNSW in Sydney, points to a powerful intersection of culture, psychology, and evolution.
“It’s cultural and traditional, how we have attached value to gold, not in just in terms of the actual value of the asset, but in terms of emotional value where it’s considered from everything from good luck to a symbolism of wishing the best to your close family and friends on occasion,” she told SBS News in a recent interview.
“There’s also research that humans have over time evolved to sort of get attracted towards jewels and gold, which just because it gives them that assurance, it’s an asset, it’s a resource.
“And just with water, food, these assets have over time evolved to hold meaning for us.”
For jewellery retailers, understanding this emotional resonance is important. Gold is not just a commodity; it is a narrative, a connection to heritage, and a perceived guarantee of value.
Over the past 12 months, gold prices have surged to record highs, at times breaking above $USD5,000 per ounce. Theories as to why gold has rocketed to dizzying heights are everywhere – global and geopolitical uncertainty is the most common explanation; however, what really matters is the consequences for the jewellery trade.
The impact of rising material costs has been immediate, and ongoing concerns around cost-of-living pressures and the impact of adverse economic factors on discretionary spending are notable.
Nigel Green, chief executive of UK-based global financial advisory firm de Vere Group, believes that the climb is far from over. “Gold benefits when political signals create uncertainty about growth, inflation, and international cooperation,” he told CBS News.
“The $USD5,000 milestone marks a beginning rather than an endpoint. We believe $USD6,000 is not unrealistic by the end of the year.”
Meanwhile, researchers suggest gold demand hit an all-time high last year as global instability and trade tensions fuelled investment, even as record prices kept many jewellery buyers away from the counter.
Global gold demand rose by one per cent in 2025 to 5,002 metric tons, the highest level on record, according to the World Gold Council.John Reade, senior market strategist, said the coming year was shaping up to be volatile.
“The biggest question this year will be whether investment demand is going to be strong enough to maintain the strength of the gold market,” he said.
The World Gold Council expects record-high prices to continue weighing on jewellery demand this year. Gold jewellery demand declined 18 per cent in 2025, with buying in China declining by 24 per cent, reaching its lowest level since 2009.
In Australia, the surge has triggered a different consumer response. Around October, reports emerged of long queues forming as people sought to sell old gold jewellery. Across the country, a ‘cash-in’ phenomenon appeared to have taken hold, with households reassessing forgotten items tucked away in drawers and jewellery boxes.
Retail jewellers reported increased foot traffic from people selling unwanted or broken pieces, including chains, bracelets, and even watches, to capitalise on the high price of gold. Some consumers reported being surprised by what once-neglected items now fetch.
This reflects the strength of the gold market and shifting household financial priorities.
The Perth Mint reported ‘unprecedented’ demand from both buyers and sellers eager to take advantage of record prices.
To cope, the Mint expanded its bullion service area by adding four temporary counters in its luxury jewellery store and hiring additional staff to manage the surge in applications.
Visitor numbers reportedly climbed sharply, rising from an average of 5,000 per week to more than 9,000 in that reporting period.
While high prices have historically dampened retail demand, general manager Tina Kircher suggested this cycle is defying expectations.
“Traditionally, as gold prices climb, we see retail investors hesitate to buy. But this time, customers are undeterred,” Mrs Kircher said.
For jewellery retailers, elevated prices may reshape purchasing behaviour. Customers may gravitate toward lighter carats, smaller designs, and, in some cases, delay purchases altogether.
Others may be enamoured of gold after witnessing the precious metal generate wave after wave of headlines, or alternatively, turn towards more budget-friendly metals.
Behind the scenes, rising stock costs and cash-flow pressures are intensifying. Strategic pricing, inventory management, and product mix are of increasing concern, rather than secondary considerations.
A recent special report examining the impact of rising gold prices offered further insight from across the Australian jewellery industry.
A Sydney Morning Herald analysis spoke with several retailers from across the country on the impact of sky-high gold prices on the trade.
Jenny Chiu of Jenny Chiu Weddings pointed to the way rising prices complicate family traditions for Asian consumers, where gold plays a culturally significant role.
Nadia Neuman, creative director of Sydney-based Mondial by Neuman, described the issue as complex, while noting that gold remains highly desirable for heirloom pieces.
Melbourne jeweller Cushla Whiting said the impact has been particularly acute in fine jewellery and engagement rings.
“It’s affecting everything for us. In the first couple of years, we didn’t increase our prices at all, but now it’s got to the point where if we were to replace something in stock, we’re actually losing money,” she said.
“A lot of our heavier custom pieces we’re offering in silver. To make them in gold now would just be unobtainable for most.” She added: “It’s ironic that all these chunky gold pieces have come back into fashion because it’s so expensive.” Fellow Melbourne jeweller Seb Brown echoed the shift, noting growing interest in silver as a practical alternative.
“I always prefer to use gold as it is such a beautiful material to work with and to wear, and the finishes you can achieve are so vast,” he explained.
“The gold price has gone up around 40 per cent in the past few years, so has the price of almost everything, so it’s a tricky time for businesses in general.”
“The price of the raw material can fluctuate between the order being made and the pieces being produced, meaning the bottom line can be affected by 5 to 15 per cent.
“Silver is a great option for that, because our customers can stretch their budgets and design something really unique.”
For jewellery store owners across Australia, these market dynamics are more than abstract figures; they shape everyday decisions about inventory, pricing, and customer engagement.
Rising gold prices are influencing what buyers choose, how much they spend, and which pieces resonate with them.
Gold’s cultural significance remains unwavering. Jewellers are forced to be nimble and adaptable, turning challenges into opportunities and capturing both new customers and lasting loyalty.
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